Analysis: Some lawmakers question Missouri gov's cuts

JEFFERSON CITY, Mo. (AP) -- No one has questioned the need for Missouri to spend taxpayer money to help clean up debris and rebuild public facilities after the nation's deadliest tornado in decades destroyed a wide swath of Joplin.

But some Republican officials have begun to question whether Democratic Gov. Jay Nixon is inappropriately citing the tornado as a reason to hold on to state dollars that had been due to public schools and other government programs.

At issue is a provision in the Missouri Constitution that gives governors authority to make spending cuts if -- and only if -- state revenues fall short of the estimates upon which the state budget was based. If times are good, the governor must follow dollar-by-dollar each of the hundreds or thousands of specific appropriations that lawmakers list in the budget. If finances are bad, the governor can hold back some or all of the money allotted for particular programs and use it to make up for shortfalls elsewhere.

That's what Nixon has done each year since he took office in January 2009. It was easily defensible as Missouri's tax revenues plummeted because of the economic recession. But Nixon has continued to hold back money as revenues have begun to improve. Most recently, he cited the unexpected costs of the Joplin tornado and -- to a lesser extent -- flooding along the Mississippi and Missouri rivers and their tributaries.

To some lawmakers, Nixon's explanation sounds more like an excuse than a legitimate justification for the continued cuts.

"There's no doubt that addressing flood damage in southeast Missouri and addressing tornado damage in Joplin should be a top priority for the state of Missouri, and it is," said Senate Appropriations Committee Chairman Kurt Schaefer, a Republican attorney from Columbia. "But it doesn't give the governor the ability to withhold from education.

"You can't withhold because you want to spend the money somewhere else," Schaefer added. "You can only withhold when money coming in doesn't meet the budget."

Nixon's budget director, Linda Luebbering, said the spending cuts are necessary because revenues continue to fall short of anticipated expenditures -- even though finances have improved.

The disagreement centers on both the past and current state budgets.

Before the 2011 fiscal year began in July 2010, Nixon announced he was holding back about $300 million in general revenue expenditures -- including $70 million for school busing -- because revenues were likely to fall short of their budgeted amounts. Nixon later released a portion of that school busing money. But when the fiscal year closed June 30, about $275 million of those cuts remained -- effectively making them permanent.

Republican House and Senate leaders contend Nixon should have been compelled by the constitution to release more of that money.

"He's stockpiling money at the expense of school kids right now," said House Budget Committee Chairman Ryan Silvey, R-Kansas City.

Although Schaefer disputes the figure, Nixon's budget office says the 2011 budget was based on Missouri receiving $7.223 billion in general revenues. The state ended the fiscal year with $7.176 billion in revenues -- a shortfall of $47 million from that original amount, which would imply Nixon held back more than necessary.

But Luebbering said calculating the actual shortfall is not that simple. She says the math must include about $100 million that lawmakers added to the original budget to pay for costs that arose later. Plus several estimated expenditures in the original budget came in higher than expected, Luebbering said. When floods inundated southeast Missouri and a tornado hit Joplin in May, Nixon committed $50 million in state aid, which Luebbering said counted as a liability for the 2011 fiscal year even though most of the money was not paid before the year ended.

Absent the natural disasters, Nixon may have released some of the money he withheld, she said.

But "obviously there was a decision that the biggest priority was making sure we had enough money for disaster recovery, and therefore we did not release anything," Luebbering said.

That budgeting approach has carried over to the 2012 fiscal year, which began July 1. Last month, Nixon announced that he was withholding $57 million in general revenue appropriations for the 2012 budget, with the largest chunk coming from public colleges and universities. The governor cited the disasters as a chief reason.

On July 1, Luebbering announced that the governor was committing an additional $100 million for disaster aid to be paid for with the better-than-expected revenues carried over from the 2011 fiscal year.

Republican legislative leaders say they also want to help Joplin. But they say the proper way to do so is for Nixon to ask them to tap into the state's $500 million "rainy day fund" created for disasters, not for Nixon to divert money budgeted for education and other government programs. Nixon's budget director has said the "rainy day fund" remains an option, if the $150 million Nixon has set aside is not enough.

Unlike a budget veto, which can be overridden, lawmakers have no recourse to reverse Nixon's decisions to withhold money when he cites revenue shortfalls. That's making some lawmakers increasingly frustrated.

"Quite frankly, what he's setting up is a separation of powers show-down," Silvey said. "How that gets resolved, I'm not sure."